Assessing the New Federalism Discussion Paper No. 99-13
Assessing the New Federalism is a multiyear Urban Institute project designed to analyze the devolution of responsibility for social programs from the federal government to the states, focusing primarily on health care, income security, employment and training programs, and social services. Alan Weil is the project director. Researchers monitor program changes and fiscal developments. In collaboration with Child Trends, the project studies changes in family well-being. The project aims to provide timely, nonpartisan information to inform public debate and to help state and local decisionmakers carry out their new responsibilities more effectively.
Key components of the project include a household survey, studies of policies in 13 states, and a database with information on all states and the District of Columbia, available at the Urban Institute's Web site. This paper is one in a series of discussion papers analyzing information from these and other sources.
The project has received funding from the Annie E. Casey Foundation, the W.K. Kellogg Foundation, the Robert Wood Johnson Foundation, the Henry J. Kaiser Family Foundation, the Ford Foundation, the John D. and Catherine T. MacArthur Foundation, the Charles Stewart Mott Foundation, the David and Lucile Packard Foundation, the McKnight Foundation, the Commonwealth Fund, the Stuart Foundation, the Weingart Foundation, the Fund for New Jersey, the Lynde and Harry Bradley Foundation, the Joyce Foundation, and the Rockerfeller Foundation.
The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.
Contents
Declines in Food Stamp and Welfare Participation: Is There a Connection?
The Food Stamp Program and Recent Changes
Food Stamp Program Participants from the NSAF
NSAF Data Quality
Who Left the Food Stamp Program?
How Do Food Stamp Exit Rates for Former Welfare Families Compare to Other Families?
Eligibility and Participation Rates
Why Do Families Say They Leave the Food Stamp Program?
Food Security and Economic Struggles
Summary and Implications
References
About the Authors
Declines in Food Stamp and Welfare Participation: Is There a Connection?
Surprisingly, food stamp caseloads have been declining almost as rapidly as the widely-publicized declines in cash assistance caseloads over the past few years. Between August 1996 (marking the passage of federal welfare reform) and September 1998, 6.2 million persons left food stamps (25 percent of the caseload). During the same period, 4.4 million persons left cash assistance (36 percent of the caseload) (see figure 1). While we expected declines in Food Stamp Program (FSP) participation as a result of the continuing strong economy and federal reforms that scaled back the Food Stamp Program (FSP), these factors do not adequately explain the unprecedented decline in the food stamp program rolls.1
Many question whether there is a connection between reforms designed to move families into work and off the cash assistance rolls and recent drops in FSP participation. This concern was heightened by a recent Food and Nutrition Service (FNS) report showing that families with children on welfare accounted for the largest share of the FSP caseload decline between 1994 and 1997.2 Declines in program participation, of course, may reflect both declines in program entrants and increases in program exits. Welfare reform may have affected program entry if reforms designed to divert families from entering cash assistance have also diverted them from food stamp participation, but this paper focuses primarily on program exits to understand the extent to which families continue participating in food stamps after leaving cash assistance. Declines in participation among former welfare recipients would obviously not be a concern if they have moved into jobs with sufficient income to move them above 130 percent of poverty, beyond the eligibility range for food stamps. However, recent studies document that most former welfare recipients move into relatively low-paying jobs, and, on the basis of their earnings levels, most would retain eligibility for FSP assistance (Loprest, 1999). Concern that eligible families do not receive food stamps arises because this program was designed to help all low-income Americans purchase nutritionally balanced diets; low participation rates lead to questions about the accessibility and acceptance of these benefits for low-income families.
This paper uses data from the 1997 National Survey of America's Families (NSAF) to explore recent declines in FSP participation for families with children. The NSAF asked families about their current food stamp and welfare program participation as well as their participation since January 1995. Our analysis file includes all families with children who reported having some food stamp benefits since January 1995. We restrict our analysis to families with children to focus attention on the connection between leaving cash assistance—the Temporary Assistance for Needy Families (TANF) program, formerly the Aid to Families with Dependent Children (AFDC) program—and leaving food stamps.
If families leave food stamps at the time they leave welfare, even when they are apparently still eligible, policymakers may need to focus more resources on ensuring that families know that food stamp benefits usually remain available until their incomes exceed 130 percent of poverty and to facilitate the process of maintaining eligibility for families who want to continue this support. To the extent that this information is available and families still leave food stamps when they leave welfare, we may want to consider reforms that would target nutrition assistance to low-income families in new ways.
Our paper begins with a description of the FSP focusing on changes that were part of the 1996 federal welfare reform package and subsequent legislation that could affect families' participation in the program. Then we compare the characteristics of families who left food stamps in the last two years with those who are currently on the program. The next section compares food stamp exit rates for families who left cash assistance to those who had not received cash assistance in the last two years. Then we highlight the current income picture of families who left food stamps to estimate what proportion still seem to qualify for food stamps. Finally, we show reported reasons for leaving food stamps, again separating results for former cash recipients and nonwelfare families.
See the PDF for complete report.
Figures
Figure 1
Food Stamp and Welfare Caseloads: 1996-1998
Notes
1. While there is some debate over the exact relationship between the economy and food stamp program participation, most studies concur that lower unemployment rates lead to significantly higher program exit rates at least for some groups. (See Burstein and Visher, 1989; Gundersen, 1998; and U.S. Department of Agriculture, 1998a.)
2. See U.S. Department of Agriculture (1999b).
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